Colbert Operates a Catering Service on the Accrual Method

question 3

Multiple Choice

Colbert operates a catering service on the accrual method. In November of year 1 Colbert received a payment of $9,000 for 18 months of catering services to be rendered from December 1st of year 1 through May 31st year 3. When must Colbert recognize theincome if his accounting methods are selected to minimize income recognition?

• A) $500 is recognized in year 1, $6,000 in year 2, and $2,500 in year 3.
• B) $2,500 is recognized in year 1 and $6,500 in year 2.
• C) $9,000 is recognized in year 1.
• D) $9,000 is recognized in year 3.
• E) $500 is recognized in year 1 and $8,500 in year 2.

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Definitions:

Transference

Applicability Of Training To Job Situations; evaluated by how readily the trainee can transfer the learning to the job.

Participation

The act of taking part or getting involved in activities or discussions, often referring to employees’ involvement in decision-making processes within an organization.

Repetition

The act of repeating something, often to emphasize or ensure understanding.

Development

Planned activities aimed at providing employees with enhanced skills and competencies for the future.